Obesity remains a serious health problem and it is no secret that many people want to lose weight. Behavioral economists typically argue that “nudges” help individuals with various decisionmaking flaws to live longer, healthier, and better lives. In an article in the new issue of Regulation, Michael L. Marlow discusses how nudging by government differs from nudging by markets, and explains why market nudging is the more promising avenue for helping citizens to lose weight.

Armed with a computer model in 1935, one could probably have written the exact same story on California drought as appears today in the Washington Post some 80 years ago, prompted by the very similar outlier temperatures of 1934 and 2014.

Two long wars, chronic deficits, the financial crisis, the costly drug war, the growth of executive power under Presidents Bush and Obama, and the revelations about NSA abuses, have given rise to a growing libertarian movement in our country – with a greater focus on individual liberty and less government power. David Boaz’s newly released The Libertarian Mind is a comprehensive guide to the history, philosophy, and growth of the libertarian movement, with incisive analyses of today’s most pressing issues and policies.

Yet according to Jonas Ekmark, a researcher at Volvo headquarters near Gothenburg, Sweden, this is just the start. He says we are entering an era in which vehicles will also gather real-time information about the weather and highway hazards, using this to improve fuel efficiency and make life less stressful for the driver and safer for all road users. “Our long-term goal is the collision-free traffic system,” says Ekmark.

Or as O’Toole had put it in the Wall Street Journal,

Driverless vehicles offer huge advantages over current autos. Because computer reaction times are faster, driverless cars can safely operate more closely together, potentially tripling highway throughput. This will virtually eliminate congestion and reduce the need for new road construction….

Driverless cars and trucks will be safer. They will also be greener, first by significantly reducing congestion, and eventually because vehicles will be lighter in weight due to reduced collision risks.

We have reached a denouement of sorts in the “blame XYZ companies for causing global warming which caused Hurricane Katrina which damaged my property” lawsuit that I’ve previously discussed and in which Cato filed an amicus brief. When last I blogged about this, the Fifth Circuit had apparently lost its en banc quorum – a late judicial recusal left only 8 of 16 judges available to hear the appeal – and was figuring out what to do.

Well, on Thursday the court issued an orderdetermining that it lacked a quorum, but that the panel opinion – the one that allowed the tendentious causation claims to proceed – remained vacated. The money quote: “In sum, a court without a quorum cannot conduct judicial business… . Because neither this en banc court, nor the panel, can conduct further judicial business in this appeal, the Clerk is directed to dismiss the appeal.” This means that the district court opinion dismissing the suit stands, though plaintiffs are free to seek Supreme Court review. Not surprisingly, the three judges on the panel dissented from this order (which means that the order was decided by a 5-3 vote).

The upshot of all this is that the plaintiffs ended up botching their strategy of suing companies whose shares are owned by Fifth Circuit judges. This clever legerdemain successfully removed seven judges, but that left a quorum of nine. Of course, had the late-recusing eighth, Jennifer Elrod – who would’ve been expected to rule against the plaintiffs – recused when the first seven did, the court could not have vacated the panel opinion in the first place. We’ll never know what happened after the court’s prior decision to grant rehearing that caused Judge Elrod to recuse, but at least we’re left with the second-best result: no strong decision from an important federal appellate court, but the reinstatment of the correct decision below.

Amid the din of James Carville’s screeching, you may have missed a couple of reasonable voices taking issue with the “do something, Superpresident!” approach that’s dominating the discussion of the Gulf Spill. (They both mention Cato work, which is a bonus).

“Obama’s oil spill,” if by saying so we mean to ascribe culpability to the president. He didn’t run the rigs, or oversee the plans, or grant the licenses to drill, or write the rules that govern the granting of those licenses. He was just president when the bloody thing happened.

(Varadarajan links to this piece by Peter Van Doren and Jerry Taylor on what the spill says about “the profound intellectual poverty animating our public conversation about energy policy.”)

the mythology that presidents are paternal, virtually omnipotent figures who will protect us from harm and, in the broadest sense, ensure that justice is done. Americans, in turn, crave protection from a messianic commander-in-chief, and are willing to vest him with great latitude and power in exchange for that protection.

This mystical conception of the presidency–and the power-concentrating dynamic it leads to–is the major theme of my book, especially Chapter 7, “Omnipotence and Impotence”:

In the BBC production of Robert Graves’ “I Claudius,” Emperor Augustus tells his wife Livia that the Senate had voted to make him a god in the Syrian city of Palmyra, and the people there had put a statue of him in the temple, to which they’d bring offerings in the hopes that the emperor would grant rain or cure their ailments. “Tell me Livia,” Augustus says, “If I’m a god, even in Palmyra, how do I cure gout?”

Augustus’s frustration is all-too-familiar to the modern president. He can no more “manage” the economy or provide seamless protection from all manner of hazards than Augustus could bring rain or cure gout.

Neither Varadarajan nor Greenwald is particularly ready to feel sorry for a president who’s done everything he can to stoke irrational public expectations for presidential salvation in virtually every public policy area. Nor am I. It couldn’t happen to a nicer guy, as they say.

But it’s not entirely clear what Carville, Palin et al actually want done. A government takeover of the spill site? That’s a stupid idea. Better regulation (retroactively?)? There’s plenty of blame to go around, but color me unsurprised that incompetence and regulatory capture characterize the Minerals Management Service, and that a president who sits atop an 2-million-employee executive branch, pretending to run it, didn’t ”fix” those problems beforehand.

President Bush Surveys the Scene in His Superplane

If the story LA Gov. Bobby Jindal is telling is true (I don’t know enough to say), then he has a legitimate beef with the federal government for standing in the way of state mitigation efforts. But most of the complaints dominating the airwaves are far vaguer: centering on the atavistic notion that just by Obama traveling to the site, the magical force of Presidential Concern might cause the slick to recede. Yesterday, Drudge linked to Obama’s schedule thusly:

Schadenfreude is fun, but it’s worth worrying about the consequences of this view of the presidency. When the public views the president as the man responsible for curing everything that ails us–from bad weather, to private-sector negligence–presidents are going to seek powers to match those superheroic responsibilities. With Great Responsibility Comes Great Power (to torture one superhero slogan).

That was what happened in Katrina’s aftermath, as I explain here–and don’t be surprised if it’s the upshot of the public and the pols’ current cries for presidential rescue.

In yesterday’s Post, E.J. Dionne complained that we’ve “handed vast responsibilities over to a private sector that will never see protecting the public interest as its primary task.” But as far as incentives go, the spill is all downside for BP, which is hemorrhaging market value along with oil. In contrast, the federal government and the president may well emerge from the spill with less popularity, but more power. That’s the logical consequence of the public’s boundless conception of presidential responsibility.

In March, Cato published my review of every rail transit system in America (as of 2008), showing that in nearly every case buses would have been more cost-effective at moving people. This same view was expressed last week by a surprising source: Peter Rogoff, the Obama administration’s appointee in charge of the Federal Transit Administration (FTA).

Appropriately, Rogoff spoke before the Federal Reserve Bank of Boston, whose transit system, he pointed out, is in a “grim” state. Nationwide, he noted, America’s transit industry suffers from $78 billion worth of deferred maintenance – most of which is due to rail transit lines that cities cannot afford to keep in shape. Rogoff was disturbed that cities were asking for federal grants to build more rail lines when they can’t keep the existing trains in a state of good repair.

Rogoff says he has been telling transit managers, “if you can’t afford to operate the system you have, why does it make sense for us to partner in your expansion?” Cities that build “shiny new rails now … need to be mindful of the costs they are teeing up for future generations.”

“Let’s start with honesty,” he said: “Paint is cheap, rails systems are extremely expensive.” He suggested that, instead of expensive trains, many cities can attract just as many riders onto transit by painting buses on specific routes in distinctive colors (as Boulder, CO has done).

Part of the problem, Rogoff knows, is that Congress has given cities incentives to build high-cost transit projects. To address this issue, the last transportation bill, in 2005, included a section requiring the Federal Transit Administration to evaluate the incentives created by federal funding.

Unfortunately, the FTA dropped the ball: the resulting report said nothing about existing incentives and addressed only the question of whether new incentives could be created to encourage agencies to bring their properties up to a state of good repair. While that is a laudable goal, it is an input, not an output.

According to historic data published by the American Public Transportation Association, the productivity of public transit – outputs per unit of input – has declined dramatically since the federal government began funding transit in 1964. From 1964 through 2008, the inflation-adjusted cost of operating transit increased by more than 360 percent, while transit ridership grew by a mere 24 percent and fares by 62 percent.

Ultimately, transit should be privatized, but in the meantime Congress or the administration can adopt a race-to-the-top program similar to the one the administration is using to improve education. Rogoff should direct his agency to rewrite its incentive report before Congress takes up transportation again in 2011.

But neither of them really says much about it. Don’t bother with the articles, just go buy the book. It’s a compelling, comprehensive case – with more than 100 charts and tables – for the case made in the title, which deserves to be bullet-pointed. It shows that the state of the world is improving because

This echoes identical anxieties while the world went through a far more dramatic Asian currency crisis after July 1997, and a Russian debt crisis the following May.

The most widely ignored effect of that crisis, however, was to depress foreign demand for oil, and thus slash oil prices to U.S. buyers from $25 a barrel in early 1997 to $11 by the end of 1998.

Oil is a major input into the manufacturing process (e.g., chemicals and plastics), and a major cost of distribution (trucks, trains and airplanes). It is also a major determinant of the cost of all energy sources used in making other goods such as aluminum and paper. When marginal costs go down, it becomes profitable to expand production.

At the height of the Asian/Russian crises, the table below shows that U.S. manufacturing output rose by more than 10 percent. It’s an ill wind that doesn’t blow somebody some good.

During the last big foreign currency/debt crisis, the real growth of U.S. Gross Domestic Purchases (the home-grown portion of GDP) jumped by 4.7% in 1997 and 5.5% in 1998. Yet the Fed cut interest rates three times in October and November of 1998 because of what was happening in other countries.

The table show what happened to the price of oil and to U.S. manufacturing from June 1997 to December 1998. The middle column is the price of a barrel of West Texas crude, and the column to the right is the U.S. industrial production index for the manufacturing sector.

Last week Paul Krugman seized on the Gulf oil spill as another occasion to bash libertarians in general and the great Milton Friedman in particular. On Friday David skewered the Times columnist over his odd rhetorical ploy of treating politicians’ failure to follow Friedman’s principles as a refutation of those principles. Now economist Alex Tabarrok at Marginal Revolution reports that Krugman also completely misunderstands the current set of laws governing oil spill liability:

The Oil Pollution Act of 1990 (OPA), which is the law that caps liability for economic damages at $75 million, does not override state law or common law remedies in tort (click on the link and search for common law or see here). Thus, Milton Friedman’s preferred remedy for corporate negligence, tort law, continues to operate and there is no doubt that BP’s potential liability under common law alone would be in the billions of dollars.

…The point of the OPA was not to limit tort law but to supplement it.

Tort law, as traditionally understood, could only be used to recover damages to people and property rather than force firms to pay cleanup costs per se. Thus, in the OPA as I read it – and take the details with a grain of salt since I’m not a lawyer–there is no limit on cleanup costs. Moreover, the OPA makes the offender strictly liable for cleanup costs which means that if these costs are proven the offender must pay them regardless (there are a few defenses, such as an act of war, but they are unlikely to apply). The offender is also strictly liable for up to $75 million in economic damages above and beyond cleanup costs. Thus the $75 million is simply a cap on the strictly liable damages, the damages that if proven BP has to pay regardless. But there is no limit, even under the OPA, on economic damages in the event that BP failed to follow regulations or is otherwise shown to be negligent (same as under common law).

The link Krugman supplies, and perhaps the source of his error, was this Talking Points Memo item baldly describing “the maximum liability for oil companies after a spill” as “a paltry $75 million.” Even the most passing acquaintance with the aftermath of real-world oil spills should have been enough for Krugman and TPM author Zachary Roth to realize that liability for assessments to this one federal rainy-day fund is but one component, perhaps but a minor one, of liability for overall spill damage. And even as regards this one specialized federal fund, Krugman and Roth got it wrong, as a glance at the May 1 edition of Krugman’s own paper would have revealed:

When a rich and well-insured company like BP is responsible for the spill, the government will seek reimbursement of what it spends on cleanup from the company and its insurers.

So Krugman’s post not only strained to take a cheap shot at libertarians, but also thoroughly botched a factual background that it would have been easy enough for him to have looked up. Other that that, it was fine.